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Ask HN: What Is Happening in the UK?

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Re: Ask HN: What Is Happening in the UK?

#211

Post by psd1 »

rvieira wrote: post #175
colinmhayes wrote: post #173

Earlier quoted context omitted.

Increasing the money supply causes inflation. Rich people don't just put their money under their mattress. They invest it which means it's being given to other people who use it to buy things.

I understand why that might cause inflation. The projected cost is £55b, is this really enough to put the country in an inflationary meltdown? IMHO the problem is that none of these measures actually guarantee (or even promote) economic growth and the realisation that the UK has economic illiterate leaders it's what's freaking the markets.

To be more precise, the market has realised that the economic illiteracy of our leaders is worse than previously feared.

And I use "leaders" with scornful irony

Re: Ask HN: What Is Happening in the UK?

#212

Post by psd1 »

yieldcrv wrote: post #66

In addition to what others said about the Bank of England monetary policy being in mismatch with the UK Goverment's fiscal policy, there was an issue with pension funds. Pension funds require new investors to pay off old investors - pensioners - until the pensioner dies, we have a word for that concept but it derails discussion. Some large pension funds in the UK had borrowed against their investors capital, specific…

"gilts". It is not an acronym.

Re: Ask HN: What Is Happening in the UK?

#213

Post by psd1 »

cbeach wrote: post #171
Nursie wrote: post #167

Earlier quoted context omitted.

> We have to be careful to avoid the Argument from Authority fallacy Indeed, but we also have to be careful of writing off numerous opinions from multiple diverse sources in multiple countries, from politicians, economists, bankers and many other roles, as well as the actual actions of the people on the ground that have born out the criticisms, as the ill educated musings of a few 'pundits'. > When the most productiv…

> we also have to be careful of writing off numerous opinions from multiple diverse sources in multiple countries, from politicians I fully expect politicians in other countries to HATE the fact that we have a competitive low-tax regime that will attract business and talent. And they'll also hate that we have a devalued currency, which makes our exported goods and services more competitive. > I don't believe for a se…

The laffer curve is a reasonable hypothesis but your single data point does not prove it. You're cherry-picking.

Your citation is the daily mail. You're scornful of experts, and self-satisfied. You're gammon, aren't you?

Re: Ask HN: What Is Happening in the UK?

#214

Post by psd1 »

imdsm wrote: post #135
caoilte wrote: post #126

Earlier quoted context omitted.

> Who takes more risks, a person who works 37.5 hours in an office or a founder who puts their own capital in to try and create a company? Inherited capital in every startup I've worked at. And enough of it that they got several runs at success. It wasn't risky at all. > Which brings more value to a community, a person who is employed, or a person who employs people? Too vague a generalisation to have any value. What…

I feel slightly sad that I numbered the questions and you blew past that but then it seems you've not attempted to answer the actual questions. > Inherited capital in every startup I've worked at. And enough of it that they got several runs at success. It wasn't risky at all. In the event this was an attempt to answer, I have to say, feels like a non-answer. You do say "worked at" though, which makes me think not as…

You're really giving it to that straw man. You must be tired now.

> You've not attempted to answer the actual questions

Lol no, this is a transparent plea for validation.

No-one views tax as punitive. The real anger from the nation is directed at:

1. The financial class who has enough wealth to use non-dom status, offshore trusts and similar vehicles to dodge tax, which vehicles are not available to hoi polloi 2. Merely comfortably-rich people who wank off about how they are "job creators"

You DO get paid more. Save your whining for your therapist.

Re: Ask HN: What Is Happening in the UK?

#215

Post by psd1 »

solumunus wrote: post #139
cbeach wrote: post #3

The pound is low against the dollar, as is the Euro low against the dollar. The pound dropped in value a few days ago, but the price has recovered since then. The media chooses to focus on the drop rather than the recovery, because the drop coincided with a government announcement of some pro-growth economic policies that mainstream pundits disagree with. If you speak to people in the U.K. many would agree that payin…

Wow, what a silly comment. Enough people have already rebutted this nonsense so I don't need to, but it just shocks me to find such uninformed takes on a forum with these demographics. Also, this isn't just the left, it's practically anyone with a brain. Any conservatives from David Cameron's administration (not far right ideologues) are horrified by this, as are most of the current MP's who overwhelmingly wanted Ris…

Funny - I thought the Cameron government was extremely ideological. Osborne wasn't thick, he must have realised the damage that austerity would do in a recession. Debt was extremely manageable going into the 08 recession. Interest rates were nearly zero.

I always viewed it as a cynical way to weaken labour.

Re: Ask HN: What Is Happening in the UK?

#216

Post by penguin_booze »

alkonaut wrote: post #178
hunglee2 wrote: post #24

In simple terms, the Bank of England and UK Gov are pursuing conflicting economic policies, BoE trying to take money out of circulation through hiking up interest rates, whilst UK Gov is putting money into circulation by proposing massive debt funded tax cuts. The obvious incoherency of this then led to the markets losing confidence in the UK economy, crashing the value of the pound, which in turn makes the planned U…

Isn’t the simple option to simply reverse policies and do whatever returns confidence? No debt funded tax cuts, reduce excessive energy subsidies and so on? Sure it might be disastrous for Truss, or Government, or The Conservative party. But for the UK as a whole it must be the reasonable way out?

> reverse policies

Have you ever seen authority figures backing off? When questioned or face backlash, they only double down. In fact, that's what happened - the official word is "this is the right way", and "the government is not responsible for market movements", "it sends the wrong message to tax windfall profits", "The poor can't pay bills? That's fine, we'll cut tax for the rich - that'll fix it".

#KamiKwasi, as Twitter called it, will continue.

Re: Ask HN: What Is Happening in the UK?

#217

Post by SargeDebian »

stephen_g wrote: post #102
hunglee2 wrote: post #24

In simple terms, the Bank of England and UK Gov are pursuing conflicting economic policies, BoE trying to take money out of circulation through hiking up interest rates, whilst UK Gov is putting money into circulation by proposing massive debt funded tax cuts. The obvious incoherency of this then led to the markets losing confidence in the UK economy, crashing the value of the pound, which in turn makes the planned U…

The crashing of the pound doesn’t make the tax cut more expensive - the UK doesn’t borrow in foreign currencies. They only issue bonds in pound sterling, and the tax cut is in their own currency, so it doesn’t really change things. Not to say the tax cut is not a terrible idea - it’s absolute stupidity.

That is assuming lenders don’t want compensation for investing in a devaluating currency.

Re: Ask HN: What Is Happening in the UK?

#218

Post by bigfudge »

bigfudge wrote: post #64
dan-robertson wrote: post #30

Earlier quoted context omitted.

I don’t understand your logic? It sounds like you’re saying you changed jobs for less money so that your marginal tax rate would be lower even though your net income would be lower. In theory you could also change jobs to something that pays £125k where your marginal tax rate would be back down to 40%, though obviously you’d need to find such a job. You specifically wrote ‘marginal’ so I don’t think you’re confused b…

In what circumstances the does UK have a 60% marginal tax rate. I think the op is confused.

Apologies. I hadn’t realised this was the net effect.

I agree this is a terrible policy. Marginal tax rates should be a monotonically increasing function.

Re: Ask HN: What Is Happening in the UK?

#219

Post by agent008t »

pyb wrote: post #2

In a few words, PM Truss's first economic measures indicate that she's ideologically-driven and has no idea what she's doing. Namely, cutting taxes for the rich in hope that maybe some economic boost will "trickle-down" to the middle class and the poor. This idea is utterly discredited in economic circles. The UK central bank, the BoE, is forced to take measures to counteract what Truss and her government are doing !…

First of all, high income does not mean 'rich'. 45% tax bracket started at £150'000 income - that is not 'rich' in London.

Secondly, all else being equal, lower taxes certainly would attract talent and business to the UK and overall make people better off. As a simple example, let us consider an extreme case where the UK has a 20% flat tax while maintaining macro/political stability, and that rate is expected to persist. For starters, there will be a huge move in tech from SF and NY to the UK. It will become a very desirable destination for top talent; startups and unicorns will follow. With clever tax incentives, it would not be just London either, but cities all around the country. That influx of talent and capital would benefit the middle class and the poor too. The one bottleneck, as is usually the case, would be housing - if that is also resolved (say, making it really easy to build in/near currently depressing-looking cities), there could be a real boom to the UK economy.

As things are going now, this is unlikely to play out in the UK, unfortunately.

Re: Ask HN: What Is Happening in the UK?

#220

Post by donpott »

agent008t wrote: post #219
pyb wrote: post #2

In a few words, PM Truss's first economic measures indicate that she's ideologically-driven and has no idea what she's doing. Namely, cutting taxes for the rich in hope that maybe some economic boost will "trickle-down" to the middle class and the poor. This idea is utterly discredited in economic circles. The UK central bank, the BoE, is forced to take measures to counteract what Truss and her government are doing !…

First of all, high income does not mean 'rich'. 45% tax bracket started at £150'000 income - that is not 'rich' in London. Secondly, all else being equal, lower taxes certainly would attract talent and business to the UK and overall make people better off. As a simple example, let us consider an extreme case where the UK has a 20% flat tax while maintaining macro/political stability, and that rate is expected to pers…

Making GBP 150,000 before tax in the year 2019-2020 would put a person in the 98th percentile of salaries in the UK. If that's not rich, I don't know what is, in London or anywhere.

Source: https://www.gov.uk/government/statistics/percentile-points-f...

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